New at Reason

Tim Cavanaugh | June 1, 2006

Shikha Dalmia wonders whether the state of Michigan can survive the bumbling of Ford Motor Company's current grandson/CEO.

Comments

|6.1.06 @ 6:58PM|#

Where's Dagny when you need her?

uncle sam|6.1.06 @ 7:24PM|#

Where's Dagny when you need her?

My first thought also. 20th Century Motor Comany.

|6.1.06 @ 8:36PM|#

Henry Ford had an ideology too�a noxious mix of anti-Semitism and anti-unionism, as a matter of fact. But he kept his business separate from his politics and raised the wages of his workers well over industry norms to fuel demand for his cars

Sadly Shikha Dalmia repeats the lie that Henry Ford paid his workers high wages to fuel demand for his cars. The reason he paid workers more money was because he had to. The working conditions in the era before air conditioning were atrocious and it was hard to keep workers. He had no choice but to pay them more.

The notion that he was doing so to enable his workers to buy his cars is pure p.r. b.s. and makes absolutely no sense when you think about it logically.

Decent enough article otherwise though.

|6.2.06 @ 5:56AM|#

"Sadly Shikha Dalmia repeats the lie that Henry Ford paid his workers high wages to fuel demand for his cars...

The notion that he was doing so to enable his workers to buy his cars is pure p.r. b.s. and makes absolutely no sense when you think about it logically."

The lunacy of this argument becomes particularly evident if you try to apply it to Boeing instead of Ford.

|6.2.06 @ 8:57AM|#

Considering that it takes GM/Ford about 4 years to get from design to production the possibility of actually "righting the ship" seems remote. I do love the new Mustang though... "Introducing the all new, 2010 Toyota Mustang and the Honda Corvette!"

|6.2.06 @ 9:43AM|#

"4 years to get from design to production"

That's a fairly typical cycle plan for most all auto companies.

|6.2.06 @ 11:22AM|#

wellfellow, I wasn't suggesting that it wasn't typical. I was considering the fact that GM/Ford are in trouble now, with few potentially profitable products in the pipeline. If they are only now regonizing their failure in the marketplace, it's probably too late.

|6.2.06 @ 11:31AM|#

Ford has a couple good products... the Ford Focus is a good car (and a profit maker worldwide, if not in the U.S.)... the new F-150 is the hands down best pickup truck ever (when I worked for an advertising agency making adverts for a competing pickup truck, our ad campaign was refered to as "damage control"... The other auto company told us "Ford F-150 is the best"). And the new Ford Mustang is certainly very cool looking!

Ford's future isn't as depressing as GM.

|6.2.06 @ 12:25PM|#

booty0,

True enough.

Rex,

I concur, the F-150 is fantastic in the way of pick-ups, with a pretty handsome interior. The Pontiac Solstace is a great looking car, but doesn't yield a whole lot of profit.

|6.2.06 @ 12:33PM|#

I won't argue that Ford and GM still have an edge on the competition when it comes to making muscle cars, pick-ups, and minivans, or that they're basically able to hold their own with regards to SUVs. Their problems, at least from a market-share perspective, really center around their inability to develop quality, reliable, relatively fuel-efficient mid-range sedans. The Japanese (and to a lesser extent, the Germans and Swedes) have been eating their lunch here, and it doesn't look as if this situation's on the verge of changing.

Factor in the effect of high oil prices on SUV and minivan sales, and the effect of haywire trade unionism on gross profit margins, and you've got a recipe for industrial disaster.

|6.2.06 @ 12:48PM|#

Eric II,

The Swedes are Ford and GM. (Volvo and Saab respectively)

"haywire trade unionism" -that's it right there. That more than anything else IMO.

|6.2.06 @ 1:07PM|#

Whatever Bill Ford sins are as CEO of Ford, they pale in comparison to his sins as owner of the Detroit Lions.

|6.2.06 @ 1:55PM|#

The Swedes are Ford and GM. (Volvo and Saab respectively)

Looks like you're right about that. It's getting a little hard to keep track of all the mergers in this space. Though I'd still posit that market share declines in the mid-range sedan market have a lot (though certainly not everything) to do with GM and Ford's financial troubles, especially since the heaviest blows have come from Honda, Toyota, and Nissan.